Management of Impacts, Risks and Opportunities

Description of the process for identifying and assessing the material impacts, risks and opportunities

In order to be able to identify material impacts, risks and opportunities for us, we updated the analysis performed in 2024 of double materiality in accordance with ESRS in the reporting period. The adjustments made are noted in the following sections in the appropriate places.

The analysis was based on a process consisting of six sub-steps. All ESRS topic standards and the respective sub-topics were taken into account in all sub-steps.

1. We analysed all countries with Bechtle locations and the number of own workforce in the individual countries. In addition, we determined our individual value chain based on our business activities and our business model.

2. We then interviewed internal and external stakeholders to identify impacts, risks and opportunities.

3. In the third step, we drew up an inventory of the impacts and assessed them according to severity and probability of occurrence. (Materiality of the impacts)

4. We then identified risks and opportunities, which we assessed qualitatively according to their expected scope and probability of occurrence. (Financial materiality)

5. In the fifth step, we analysed the results and identified the material issues for Bechtle.

6. Finally, the implementation of the criteria set out in the ESRS for carrying out the double materiality analysis has been summarised.

We have measured climate-related physical and transiton risks as part of a climate risk analysis, which is discussed in the Strategy chapter under Material impacts, risks and opportunities and their interaction with strategy and business model and climate change. No material IROs were identified in relation to water and marine resources. We have considered dependencies on biodiversity and ecosystems as well as their performance and systemic risks along the value chain using steps 3 and 4 described below.

Step 1 – Value chain. The value chain provides an overview of the most important stages associated with Bechtle’s business activities. It is necessary for analysing materiality in order to identify both positive and negative impacts along Bechtle’s entire value chain. In defining the value chain, we focused on the areas in which impacts, risks and opportunities are considered probable due to the nature of the respective activities, business relationships, geographical circumstances or other factors. When selecting relevant topics, we were guided by the ESRS list of topics in accordance with 1. AR 16. The process of identifying potential IROs is based on a screening of the Bechtle locations and relevant activities along the value chain.

Step 2 – Stakeholder involvement. The involvement of affected stakeholders is a central component of the measurement of the materiality of sustainability aspects. When selecting the stakeholders, we made sure to interview contact persons from all stages of the value chain in order to find out the needs of different stakeholder groups. As part of source/desk research and interviews, we assigned sub-topics and sub-sub-topics to the ESRS topics as qualitative input, which made it possible to reduce the topic longlist. Following the direct involvement of stakeholders in the course of the 2024 materiality analysis, Bechtle switched to utilising feedback from the entity’s continuous stakeholder dialogues in the reporting period. They are systematically incorporated into the measurement of materiality and into the further development of actions and their disclosure. The direct involvement of stakeholders takes place every two to three years and is a material component of the materiality analysis, which is reviewed and updated annually.

Step 3 – Materiality of impacts. Negative and positive, as well as actual and potential impacts along the value chain, were identified with the help of the assessments of the Bechtle experts and the findings from the stakeholder involvement and analysis, as well as extensive desk research. The identified impacts were assigned to the ESRS sub-themes and assessed according to their materiality using an assessment methodology.

The materiality assessment analyses the severity and probability of actual and potential negative and positive impacts on people and/or the environment along the entire value chain. The impacts describe the negative or positive influence of Bechtle on the environment and/or society that occur or may occur in relation to the respective topics.

When analysing the sub-topics, we identified several impacts by Bechtle on the environment, people and governance aspects. We have measured the severity of the impacts according to the sum of the scope, extent and remediability and categorised each characteristic on a scale of 1–5 (a scale of 1–3 was used in 2024). To order to define a cut-off for the information that is to be disclosed as material, an updated threshold value of ≥ 10.1 was set in 2025 for the negative impacts (2024: 6.1) (upper third). A standardised numerical threshold for positive and negative impacts is not possible due to the different assessment dimensions. In the case of positive impacts, the degree to which they could be mitigated does not apply, which in turn is fundamental for negative impacts. For the positive impacts, we analogously selected the upper third with a threshold value of ≥ 6.8 (2024: 4.1.) The threshold was determined on the basis of the Bechtle business model, the value chain and fundamental topics.

Step 4 – Financial materiality. Financial materiality discusses sustainability aspects that can have a positive or negative impact on the value of an entity and its financial performance. For Bechtle, the main financial risks and opportunities result from the financial materiality. The financial perspective is closely linked to that of the impacts. For example, Bechtle can or could have impacts on people or the environment that lead to risks and opportunities:

• resulting from the impacts themselves and/or,

• from amendments to the strategy, the business model and the operating processes or

• from actions to remedy negative impacts.

The same predefined list of ESRS topics, sub-topics and sub-sub-topics was used to identify the material risks and opportunities as was already used to identify the material impacts.

Financial materiality was determined in four steps. The first step was to analyse the current status. Further potential risks and opportunities were then identified in the course of a desk analysis. TCFD and SASB were used here as examples to evaluate further ESG risks and opportunities, and a screening of regulations, competitors and media reports was carried out. The risks and opportunities listed were examined and allocated to the ESRS topics. In addition, further risks and opportunities resulting from impacts were identified. The result was a list of ESG risks and opportunities, which we then assessed in terms of materiality.

In the next step, we carried out a qualitative assessment of the financial impacts according to severity and probability. Risk management was also involved in the validation and correction process in order to discuss and agree on the findings and review the qualitative assessment on the basis of the severity and probability of the financial impacts. Lastly, the final results were consolidated.

The risks and opportunities were measured on the basis of the compiled inventory of risks and opportunities. This inventory contains scenario descriptions of possible sustainability risks and opportunities that have an impact on the development of Bechtle’s net assets and earnings position, cash flow, access to funds or the cost of capital over a short, medium or long-term timeframe. To this end, each risk and each opportunity is measured on a three-level scale in terms of its probability of occurrence and the expected amount of loss.

In the course of the materiality analysis adjusted in the reporting period and the associated changes to the threshold values, the risk potential of the loss amount was also brought up to date and corresponds to the potential loss amount determined by Bechtle’s central risk management.

The risk measurement is carried out at a qualitative level as precise quantification is not possible or hardly possible. Definitive quantification is not possible on a reliable basis, particularly in the area of potential reputational risks, but also for risks that are interlinked with the topic of people. The transition period was also used for a qualitative assessment.

The materiality thresholds are applied to sustainability-related risks and opportunities if the overall measurement is high. This is high if the probability of occurrence and the amount of loss are high or the probability of occurrence is medium and the amount of loss is high and vice versa.

Step 5 – Validation of results. At the end of the materiality analysis process, all results were validated internally and discussed with the Executive Board. The results were then transferred to Central Risk Management. We did not identify any material impacts, risks or opportunities for the topic standards Water and marine resources and Biodiversity and ecosystems.

In addition, we were able to exclude three ESRS subtopics. We deliberately decided not to include the topic of “Pollution of living organisms and food resources” in the sub-topics in the environment area, as this content is sufficiently covered by the ESRS topic of pollution. It was treated as a “secondary impact”, which can mainly result from air, water and soil pollution. For Bechtle, this topic is not relevant to the industry. We were able to exclude “Social inclusion of consumers and end-users” from the social topics and “Animal welfare” from governance as we consider these to be outside Bechtle’s area of business. We focused on those areas in which impacts, risks and opportunities are considered probable due to the nature of the respective activities, business relationships, geographical circumstances or other factors.

The update of the materiality analysis 2025 has shown that the “Affected communities” topic area (ESRS S3) is no longer classified as material.

The process of identifying potential IROs in connection with water and marine resources is based on a screening of Bechtle locations and activities or relevant interfaces to water and marine resources. All direct entity locations and relevant activities in the value chain were audited. The focus was on material upstream activities (in particular the extraction of raw materials and procurement of IT hardware) and the operation of data centres. Based on existing entity data and as part of source and desk research, as well as interviews, possible causes were analysed, IROs derived and then evaluated based on severity and probability of occurrence.

As part of the entity-wide materiality process, Bechtle has carried out a qualitative measurement of environmental impacts in order to identify actual and potential impacts on biodiversity and ecosystems. The analysis covers our own locations as well as upstream supply chains and downstream activities.

Negative impacts on biodiversity caused by pollution and changes in land use were analysed. They can result from the following activities, among others:

• Land and location utilisation: sealing and intervention in landscapes during construction, operation or expansion of locations,

• Use of materials and resources: utilisation of raw materials with potential impact on biodiversity,

• Emissions and energy consumption: indirect impacts due to energy requirements in data centres,

• Life cycle of products: impacts of manufacturing and disposal processes on ecosystems.

No material negative direct impacts on biodiversity at our own locations or indirect impacts in the upstream and downstream value chain were identified. The potential impacts considered were measured in terms of their severity based on their extent, scope and irreversibility and weighted with a probability of occurrence. All possible impacts have remained below the threshold value. A small scope and a medium extent in the course of the measurement of the degree of severity are decisive for this. It was thus established that biodiversity is not a material issue for Bechtle.

Dependencies of biodiversity and ecosystems and their services

Bechtle has also analysed the dependencies on ecosystem services in order to understand the extent to which the business model depends on natural resources and stable environmental conditions and to what extent potential risks can arise. Ecosystem services such as the extraction of raw materials were taken into account in the measurement.

The following dependency area in particular was identified as part of this analysis:

• Material costs due to scarcity of resources: the loss of biodiversity and various ecosystem services can lead to rising procurement costs in purchasing. The loss of biodiversity has a direct or indirect impact on resources of various kinds and increases the scarcity of resources. This can lead to rising costs and expenses for Bechtle AG in the procurement of hardware.

The dependencies and the resulting risks were measured as part of the analysis of financial materiality. The results show that Bechtle is not materially and directly dependent on functioning ecosystems in the global supply chain but is indirectly dependent on them.

Location analysis in relation to biodiversity

Bechtle has several locations in Europe (distribution and logistics centres, offices). A location analysis was carried out to determine whether our facilities are located in or in the immediate vicinity of areas with high ecological sensitivity or designated protected areas. The basis for this was the use of the WWF Risk Filter. It was determined that none of Bechtle’s locations are located directly within a designated high-sensitivity area. None of our locations currently leads to a documented deterioration of natural habitats or impairment of protected species within the meaning of ESRS E4 IRO-1 AR 19a, and no remedial actions need to be taken.

No material impacts, risks and opportunities requiring entity-specific disclosures were identified by Bechtle.

The following overview summarises the current status of the material topics in the reporting period:

Step 6 – Explanation of the identification of the material information that must be disclosed in relation to the IROs measured as material. As the last step of the DMA, the IRO assessment was transferred to the disclosure requirements of the ESRS. This involved analysing whether the information required by disclosure requirements and the respective data points is material within the meaning of ESRS 1.31. It was therefore decided whether each ESRS data point (1) is significant in helping to explain our material IROs and/or (2) contributes to the decision-making of users of the report or serves an information need regarding material impacts. This analysis was based on our understanding of the stakeholders’ interests, which we obtained as described in step 2 Stakeholder involvement. The materiality of information was not quantified, and accordingly no threshold values were used.